New York City passed the Fairness in Apartment Rental Expenses (FARE) Act on November 13, 2024, promising relief for tenants by shifting broker fee responsibility from renters to landlords. While tenants could save upfront costs—currently averaging $13,000—critics warn of unintended consequences.
Under the new law, landlords must absorb broker fees, typically ranging from one to two months’ rent. This change aims to improve affordability but could prompt landlords to raise rents to recoup their expenses, effectively passing the cost back to tenants.
The FARE Act, expected to take effect by summer 2025, also mandates full disclosure of all rental fees. This transparency is a win for renters but leaves landlords in a tough position, especially in a housing market already strained by regulations.
Landlords and real estate professionals argue the measure could create a ripple effect of rising rents, undermining its purpose. The law reflects NYC’s ongoing struggle to address its housing crisis without expanding inventory. Instead of adding new buildings to meet demand, the city has taken another regulatory approach that could exacerbate affordability issues.
Sources
https://www.streeteasy.com/blog/fare-act-nyc-broker-fees-renters/
https://www.gothamist.com/news/nyc-is-lifting-broker-fees-for-most-tenants-heres-what-to-know
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